If you’ve decided that collaborating with another company to compete in today’s newly flourishing construction industry is a smart move, you may be ready to draft your joint venture agreement. In this article we’ll inform you of the important elements of a joint venture contract so that your joint venture goals are accomplished satisfactorily.
What is a Joint Venture Agreement?
A joint venture agreement is a business contract between two or more parties that have decided to develop a business in order to complete a specific project for a specified period of time. The agreement outlines member’s rights and responsibilities and other aspects of the joint venture. A joint venture agreement, like any other legal document, needs to be drafted with care. Before drafting the agreement both parties should evaluate potential problems so they can be ironed out in the contract. Critically thinking through potential problems can help you avoid costly joint venture disputes.
Who Should Draft the Agreement?
It is best that your contract be in writing to avoid any confusion should anything go awry during the course of your construction project. To protect yourself, we highly recommend you consult with one of our Orlando construction lawyers to ensure your contract is drafted according to the standards of Florida law.
The Elements of the Agreement
Your contract should include as specifically as possible the terms and condition of your agreement and should be governed by the laws of the state. Each contract is as unique as the project and parties involved. As a guideline, you should consider including some of the following provisions into your document.
- The date of the establishment of your agreement
- The parties involved in the venture
- The business name of the joint venture
- A description of the project the venture is purposed for
- Financing and accounting details
- How profits and losses will be shared
- An Equipment and materials clause if applicable
- A defined general manager and individual responsibilities
- Outlined ramifications should a party be unable to fulfill individual obligations
- How you will obtain licenses
- Contract termination specifics
Disclaimer: The information contained in this article is for general educational information only. This information does not constitute legal advice, is not intended to constitute legal advice, nor should it be relied upon as legal advice for your specific factual pattern or situation.